Update: Verizon's Sale of Maine, New Hampshire and Vermont

I've written here in the past about Verizon's pending sale of their Maine, New Hampshire and Vermont networks to Fairpoint Communications. Here are some highlights on the sale taken from a Burlington Press piece written yesterday:

• The sale represents roughly 1.6 million land lines in the three states.
• Sale price is $2.72 billion which, without any dept relief, would put FairPoint into $2.5 billion of debt
• Proposed deal has Verizon giving Fairpoint $235 million in debt relief.
• Maine has approved the sale but has not written a final order yet.
  
• Last week the staff of the New Hampshire Public Utilities Commission recommended state regulators sign off on the deal.
  
• Vermont's Public Service Board is currently meeting on FairPoint's proposal.
• Fairpoint has agreed to cut dividends to shareholders by $50 million a year and will not be permitted to raise the dividend until its debt ratio has been lowered.

Each state must approve the sale individually so each is also negotiating based on their own needs. For example:

• In New Hampshire, the proposed deal calls for Verizon to give FairPoint $50 million over two years to help build infrastructure and make high-speed Internet access available to 95 percent of the customers by a certain date.
• In Vermont, the proposed deal calls for 80 percent high-speed Internet availability by 2010 -- and a requirement that all customers in at least half of FairPoint's telephone exchanges have access to broadband Internet service.
• In Maine, FairPoint has agreed to freeze DSL rates for existing Verizon customers at $15 to $18 a month for two years.

Much of the discussion has been around the huge amount of debt Fairpoint would assume if the sale happens. Saddled with this debt, many are concerned about Fairpoint's ability to upgrade existing services as expensive higher bandwidth technologies go mainstream. Sure, current ADSL offerings scream when compared to dial-up but - we won't be saying that in a few years.

I'm trying to remain optimistic - is there another more cost effective technology (perhaps WiMAX, higher bandwidth DSL or even Broadband over Power Line, etc....) that will make these concerns moot? Time will tell if the sale gets final approval.